Bethany Iron and Steel is evaluating possible economic advantages of being involved in electronic commerce. A modest e-commerce package is available for $30,000. If the company wants to recover the cost in 2 years, what is the equivalent amount of new income that must be realized every 6 months at an interest rate of 12% per year compounded quarterly? Solve using two of the following three approaches: factor formula, calculator, and spreadsheet.

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A: Relevant cost: Relevant cost is the avoidable cost which incurred at the time of the decision making…

Q: Best Trim, a manufacturer of lawn mowers, predicts that it will purchase 204,000 spark plugs next…

A:

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A:

Q: The Food Store is planning a major expansion for 4 years from today. In preparation for this, the…

A: A theory that helps to compute the present or future value of the cash flows is term as the TVM…

Q: A manufacturer of toilet flush valves wants to have ₱15,000,000 available 10 years from now so that…

A: The given problem relates to concept of annuity. An annuity is a series of uniform cash flows over a…

Q: Pearson International Publishing Company is trying to decide whether to revise its popular textbook,…

A: The notion of present value asserts that a sum of cash today is worth greater than the same sum in…

Q: Shonda & Shonda is a company that does land surveys and engineering consulting. They have an…

A: Formula: Contribution margin = Sales price - variable cost.

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A: F/A is taken from table FV of an annuity of $1.

Q: equivalent present worth of the revenue this company will generate from these sources of revenue…

A: Present Worth is the discounted value of future cash flows. As value increase at the rate of…

Q: A discount furniture store is planning an expansion which will cost 12, 000, 000 three years from…

A: Future value = $ 12,000,000 Annual interest rate = 10% Period = 3 Years Deposit in year 1 = x…

Q: A small northern California consulting firm wants to start a recapitalization pool for replacement…

A: The future value of a growing annuity is the future worth of an annuity that is growing at a…

Q: What is the NPV of this investment

A:

Q: Valve Corporation spent P600,000 per year for the past 3 years in developing their latest product.…

A: Here, we need to equate the present value of the cost and revenues. PV of cost now = PV of base…

Q: A Pumpkin Pie Manufacturing Company pays on the tenth day after purchase. The average collection…

A: The question is related to Working Capital Management. The Cash Conversion cycle is calculated with…

Q: Suppose you work for a software company that has developed a new product.  The patent on this…

A: A concept through which it is studied that the current worth of money is higher than its future…

Q: A High Torque DC Motors manufacturer estimated that the permanent magnet component will cost $95,000…

A: Cost per year is $95,000  Time period is 5 years At year, manufacturer mistakenly spends $55,000…

Q: The sales and finance team of a car company is evaluating a new proposed luxury model of its brand…

A: Present worth computes the existing value of future benefits by discounting future worth with a…

Q: Galvanized Products is considering purchasing a new computer systen for their enterprise data…

A: Purchase price is $100,000 Salvage Value is $4500 Loan amount is one-fourth of purchase price MARR…

Q: A large electronic retailer is considering the purchase of software that will minimize…

A: Net present value (NPV) is a method for assessment of financial profitability of a project. NPV is…

Q: A software company that installs systems for inventory control using RFID technology spent $600,000…

A: Inventory is the investment in material which is done by the firm. Firm maintains the level of…

Q: Best Trim, a manufacturer of lawn mowers, predicts that it will purchase 204,000 spark plugs next…

A: Opportunity Cost: Opportunity cost means the potential income and other benefits that are lost due…

Q: Franklin Mints, a confectioner, is considering purchasing a new jelly bean-making machine at a cost…

A: IRR(Internal Rate of Return) is the rate of discounting at which the present value of cash inflows…

Q: Hydrex Mechanical Products plans to set aside $160,000 now for possibly replacing its large…

A: (a) (a) tabulated factors: F = P* (F / P, in, n) F = $160,000 * (F/P), 0.04,14) F = $160,000 *…

Q: Anderson Manufacturing Co., a small fabricator of plastics, needs to purchase an extrusion molding…

A: As per the information provided: Principal (P) = $140,000 n = 5 g = 9% or 0.09 i = 13% or 0.13

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A: The present value of an annuity is the current worth of a cash flow series at a certain rate of…

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A: Time value of money (TVM) refers to the method or technique which is used to measure the amount of…

Q: The sales and finance team of a car company is evaluating a new proposed luxury model of its brand…

A: NPV is the net current worth of cash flows that are expected to occur in the future.

Q: The sales and finance team of a car company is evaluating a new proposed luxury model of its brand…

A:

Q: A business industry has a new product whose sales are expected to be 1.2, 3.5, 7, 5, 3 million units…

A: The Present worth method means computing the Present value of all the cashflows generated from the…

Q: Park company is building a new office building, and management is trying to decide how rent payments…

A: A study that proves that the 1value of money today is higher than the future value of money is term…

Q: 3f

A: Payback period: It is period required to collect initial amount. Payback period > Life of the…

Q: A Pumpkin Pie Manufacturing Company pays on the tenth day after purchase. The average collection…

A: The question is related to Working Capital Management. The Cash Conversion cycle is calculated with…

Q: Sensotech, Inc., a maker of microelectromechanical systems, believes it can reduce product recalls…

A: MARR is return that an proposal must earn to qualify for investment. Investors or Manager have…

Q: The sales and finance team of a car company is evaluating a new proposed luxury model of its brand…

A: Present worth analysis is an analysis in which we convert all the cash flows to present worth using…

Q: Accusoft Systems is offering small business owners a software package that keeps track of many…

A:

Q: Accusoft Systems is offering small business owners a software package that keeps track of many…

A: PAYBACK PERIOD IS THE PEROD DURING WHICH THE FIRM RECOVERS INITIAL INVESTMENT OF THE PROJECT. given,…

Q: make in excel and take screenshots. A Pumpkin Pie Manufacturing Company pays on the tenth day after…

A: Company can decrease the cost if working capital has been reduced and that is possible by decrease…

Q: Environmental recovery company RexChem Partners plans to finance a site reclamation project that…

A: Given: The company borrows $4.1 million The compounding period n is 4 years Interest is 15% per…

Q: A large electronic retailer is considering the purchase of software that will minimize shipping…

A: In the given situation, Purchase of Software has to be justified for the annual expenditure incurred…

Q: Loadstar Sensors is a company that makes load/force sensors based on capacitive sensing technology.…

A: The future value of a cash flow is the future worth of a cash flow at a certain rate of interest and…

Q: Accusoft Systems is offering small business owners a software package that keeps track of many…

A: Recovery of investment means situation of no profit and no loss form the investment or time period…

Q: 4

A: MONTHLY PROFIT = $2000 THEN  YEARLY = $2000*12=$24,000 YEAR CASH FLOW      0 -81000 1 24000…

Q: How much will be the equivalent worth of ₱2M invested today for three years at a commercial rate of…

A: The equivalent worth of the amount can be calculated using the formula of the future value.

Q: Rogers Inc.is considering investing $320,000 in hardware and software to develop a…

A: Accounting Rate of Return (ARR) seems to be the yearly % of the average net earnings created by an…

Q: The sales and finance team of a car company is evaluating a new proposed luxury model of its brand…

A: Present value: This is the amount of future value reduced or discounted at a rate of interest till…

Q: The sales and finance team of a car company is evaluating a new proposed luxury model of its brand…

A: a. The calculation is: NPV is negative. Hence, the proposed investment is not a profitable…

Q: Best Trim, a manufacturer of lawn mowers, predicts that it will purchase 204,000 spark plugs next…

A: Opportunity Cost: Opportunity cost is a total of potential income and other benefits that are lost…

Q: A pulp and paper company is planning to set aside $150,000 now for possibly replacing its large…

A: Future value = Present value * (1+ rate)^no. of years 8)

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.